Four Things to Know about the Higher Education Emergency Student Funds

Financial Wellness
Policy and Advocacy
Public Policy Division

May 5, 2020
Alexa WesleyNASPA

With news about coronavirus changing day by day, hour by hour, it can be challenging to discern what each update means for student affairs professionals and the students they serve. Enacted on March 28, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act provides $14 billion in relief funds to institutions of higher education. The Education Department’s new guidance about the Higher Education Emergency Relief Fund (HEERF) – half of which must be used for student aid – has raised several questions about the implications of the emergency cash grants to students. There are four key takeaways from the department’s guidance about the grant aid and the impact it has on students.

The funding formula is weighted in favor of institutions with the most full-time enrollment and who have graduate student programs.

The methodology for allocating the higher education relief funds to institutions is based on two formula factors. The first factor is that 75 percent is awarded based on an institution’s share of full-time enrollment of Pell Grant recipients and the second factor is that 25 percent is based on the relative share of graduate or undergraduate non-Pell eligible students enrolled full-time. This funding calculation could disadvantage institutions that enroll more part-time students. Approximately 86 percent of part-time students enroll in public institutions and more than 60 percent go to community colleges. Including graduate students in the formula also benefits four-year universities with resources allowing them to afford to have graduate and professional programs. The calculation highlights the persistent issue of funding disparities for part-time students and to institutions who have historically received the fewest resources and that might be struggling the most.

HEERF aid is only available for students who meet Title IV requirements and who were not exclusively enrolled online on the day of the national emergency announcement, March 13.

The department’s decision to limit emergency funds to students who are eligible for Title IV came in an FAQ document published on April 21. Title IV eligibility criteria exclude international students, Deferred Action for Childhood Arrivals (DACA) recipient students, Temporary Protected Status (TPS), and undocumented students from receiving any of the emergency cash grants. The exclusion exacerbates difficulties already faced by many undocumented students and families who are affected by mass layoffs and are denied access to health insurance, stimulus checks, and unemployment insurance supports. Without action taken at the federal level, advocacy groups continue to focus on governors to adopt to expand in-state resident tuition policies for undocumented, DACA, and TPS college students. Institutions can shift their own policies so that these students are included in emergency aid efforts that pull from campus-level funds.

Moreover, excluding online students overlooks the levels of financial distress that these students are grappling with during this time. Needing help paying healthcare, childcare, food, and housing expenses is not an experience unique to campus-based students; online students may be facing the same unemployment challenges and financial circumstances. More work should be done by policymakers to ensure that the needs of the 3.1 million students enrolled exclusively in distance education courses are addressed.

Institutions must give student-marked aid directly to students, and students must only use the money towards expenses related to the disruption of campus operations.

ED guidance states that students can use funds to offset expenses under the cost of attendance, which may include food, housing, course materials, technology, health care, and child care. As NASFAA’s recent analysis of the legislation points out, there is a distinction between students using HEERF-dollars to cover expenses related to the pandemic and students who have experienced changes in their financial need. The specificity about aid being used for expenses seems to narrow the defined scope of need by overlooking students who may have had the greatest levels of change in financial need due to a loss of work caused by the crisis. Many of the pressures faced by students who had the highest pre-existing levels of financial need are likely being compounded, and students who are newly low-income are now in need of a wider range of supports.

Institutions have broad discretion to determine how to distribute cash aid to students but must report back certain details to the department.

As institutions determine the best system for distributing emergency funds, it is important to consider the range of student experiences and needs that have changed as a result of the crisis. Understanding student circumstances and barriers to accessing resources can help inform an institution’s approach to implementation. Campus administrators will need to take stock of data availability and identify additional collection needs. Institutions are required to report how grants were distributed, how the amount of each grant was calculated, and any directions given to students about the grant. Campuses will need to have robust systems in place for documenting decisions and communications with students.

Among the variety of approaches a campus can take, administrators should ensure that decisions are made with equity in mind. The Hope Center for College, Community, and Justice recently released a guide to help campus practitioners maximize equity, impact, and efficiency of emergency grant distribution amidst the COVID-19 pandemic. One main principle here is to keep administrative hurdles to a minimum for students who seek emergency aid. Fortunately, the department does not require institutions to report or track how students are spending their aid.

Looking ahead

In letters to both the House and Senate, NASPA and other higher education organizations urged Congress to allocate another $46.6 billion in funding to more adequately support the critical needs of students and institutions. In addition to the financial supports, the scope of student needs at this time touch every part of campus. Supporting students in this crisis is a collective effort, and much can be learned from others in higher education and the community. From raising emergency funds to advising during a time of uncertainty, there are a variety of areas where student affairs practitioners can share resources and insights with others working to address similar challenges.